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2025 Supreme(Online)(Kar) 9012
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
S.R.KRISHNA KUMAR, J
M/S ATHENE TECHNOLOGIES INDIA LLP – Appellant
Versus
STATE OF KARNATAKA – Respondent
WRIT PETITION NO. 23286 OF 2023 (T-RES)
For the Appellants/Petitioners: SRI. RAGHUNATH M. D.
For the Respondents: SRI. ARAVIND V. CHAVAN, SMT. JYOTI M. MARADI
The court determined that the petitioner is not an intermediary under the IGST Act, affirming that its services qualify as exports and are eligible for GST refunds.
Headnote:(A) CGST Act, 2017 - Section 54 - Refund claims - Petitioner, providing software development services, sought refund of IGST, allowed initially but later rejected by appellate authority as services deemed intermediary - Court held petitioner not an intermediary under Section 2(13) of the IGST Act, confirming services qualified as export of services. (Paras 5, 11, 12, 13)
(B) Legal Definition - Intermediary - Definition clarified under Section 2(13) of the IGST Act, requiring three parties for intermediary services, with the service provider acting on behalf of another. (Paras 11, 12)
Facts of the case:
Petitioner, a limited liability partnership, provided services to an overseas entity under a Master Service Agreement, initially granted a refund claim for IGST which was later contested by the Revenue, leading to the current petition.
Findings of Court:
Court ruled that the petitioner’s services did not constitute intermediary services and thus qualified as exports under GST, restoring the original refund order.
Issues: Whether the petitioner was an intermediary under the IGST Act and the validity of refund claims based on the limitation period.
Ratio Decidendi: The court emphasized that without a triangular relationship, the petitioner’s services were independent, not intermediary, and thus eligible for refunds.
Result: Petitions allowed, orders quashed, and refund with interest directed to be granted.
| Table of Content |
|---|
| 1. petitioner's background and refund claim (Para 2) |
| 2. rival contentions and agreement details (Para 3 , 4) |
| 3. legal position on intermediary services (Para 5) |
ORAL ORDER
In this petition, petitioner seeks for the following reliefs:-
a) Allow the Writ Petition on costs.
b) Issue a writ or Certiorari by quashing the order passed by the Respondent No.2 at Annexure-F OIA No.188-190/2023-24/ADC-AII/GST dated 01.09.2023 passed by the 2nd Respondent.
c) Any other relief/s as deemed fit to be granted to the Petitioner by this Hon’ble Court in the circumstances of the case, in the interest of justice and equity.”
2. The brief facts giving rise to the present petitions are as under:-
The petitioner is a Limited Liability Partnership firm, which is registered with the service tax / GST Department and is providing software development services. The petitioner which was earlier known as ‘SWC INDIA INVESTCO LLP’ entered into Master Service Agreement vide Annexure-H dated 01.04.2019 with ‘THE ATHENE GROUP LLC, a limited liability company having its office in USA and it is an overseas entity and recipient of the services supplied by the petitioner which amounts to export of services, on account of which, the petitioner was not liable to pay service tax / GST on the said supply of services.
2.1 The petitioner filed a refund claim of IGST for April, 2022 and May, 2022 in a sum of Rs.76,16,997/- under Section 54 of the CGST Act , which was allowed by the 3rd respondent vide Order-in- Original dated 28.07.2022 passed in favour of the petitioner. Aggrieved by the said Order-in-Original, the Revenue filed an appeal before the appellate authority which proceeded to pass the impugned order dated 01.09.2023 allowing the appeal and thereby, rejecting the refund claim of the petitioner, who is before this Court by way of the present petition.
3. Heard learned counsel appearing for the petitioner and learned counsel appearing for the respondents-Revenue and perused the material on record.
4. Before adverting to the rival contentions, it would be necessary to extract the aforesaid Agreement at Annexure-H dated 01.04.2019 entered into between the petitioner and The Athene Group LLC, the overseas recipient of the services supplied by the petitioner as hereunder:-
“MASTER SERVICES AGREEMENT This master service agreement ("Agreement") is made on April 1, 2019 ("Execution Date") between:
1. T HE ATHENE GROUP LLC, a limited liability company formed under the laws of the State of Virginia, U.S.A., and having its principal office at 580 Herndon Parkway, Suite 500, Herndon VA 20170, U.S.A. (hereinafter referred to as "Athene", which expression shall, unless repugnant to the context or meaning thereof, include its successors and permitted assigns; and
2. SWC INDIA INVESTCO LLP, a limited liability partnership incorporated in India and having its registered office at No. 565/B, 7th Main Road, HAL 2nd Stage, Indiranagar, Bengaluru, Karnataka 560038, India and principal office at No. 13, 1ª Floor, "CRN Chambers" Kasturba Road Bangalore 560 001 (hereinafter referred to as "Service Provider", which expression shall, unless repugnant to the context or meaning thereof, include its successors and permitted assigns).
Athene and Service Provider are collectively referred to as the "Parties" and individually as a "Party"
WHEREAS, Athene is engaged in the business of providing technology services in the CRM (Customer Relationship Management) and salesforce ecosystem and currently sells a product called Skience to customers in the wealth management industry.
WHEREAS, Service Provider and its employees are capable of performing information technology, software development and consulting services as required by Athene.
WHEREAS, in connection with the performance of Athene's obligations to its clients ("Clients"), Athene desires to utilize Service Provider and its employees, and Service Provider desires to provide its technical services to Athene as set forth herein.
NOW, THEREFOR
